M&M lines up new tractors as competition heats up

Company will do at least five tractor launches, ramp up production at new facility aimed at maintaining market leadership

Mumbai-based Mahindra & Mahindra (M&M) is set to launch at least five tractors and ramp up production at a new facility this financial year. The company, which had a market share of 40 per cent as of April-end, today said factors such as higher minimum support price and a healthy monsoon would enable the industry to record growth of six to eight per cent this financial year.

In 2012-13, Mahindra Tractors sales fell to 2,11,596 units, a decline of 4.5 per cent compared with 2,21,730 units in 2011-12; in the same period, industry sales stood at 5,25,970 units, compared with 5,35,210 units in 2011-12.

However, after muted growth last year, the industry made a strong comeback in the first two months of this financial year. M&M posted growth of 31 per cent in the two months, with sales of 46,828 units. In May, the company announced sales growth of 24 per cent at 23,626 units, compared with 19,016 units in May last year.

In March, the company opened a new facility at Zaheerabad, Andhra Pradesh, which has an installed capacity of 1,00,000 units a month. M&M would use about a third of this capacity in a single shift. New products lined up for launch this year belonged to the 15-72 hp segment, the company said. Small capacity tractors such as the Yuvraj (15 hp), as well as powerful tractors (50 hp or higher) were seeing healthy demand, it added. For M&M, the 30-40 hp segment has been the biggest volume generator.

M-star, a tractor on a new platform, would be launched in 2014. This would cater to the 30-40 hp segment. Though the company declined to provide the M-star’s investment details, it said about Rs 350 crore was spent on new platforms.